March 27, 2008

People are Staying Home in Droves!

Extreme nonmigration strikes San Diego

U-T reporter Lori Weisberg tells us that “thousands fewer people moved out of San Diego County last year”. People still leave coastal California at a greater rate than inbound migration, but less so. The population is still growing but entirely due to births and foreign immigration. The article says that demographers believe this is due to foreclosures, mortgage market turbulence and general nervousness.

Inland areas are especially affected, the article continues. We’ve discussed this before, noting that recent expansion in inland areas (like SD county’s south east) brought recent buyers. It is the most recent buyers who are facing escalating mortgage payments even as their home value drops.

Here in the near east- El Cajon, La Mesa, Lemon Grove and Spring Valley; there are relatively few recent buyers. Many homeowners are well established and are not very concerned about the current troubles. Furthermore these homes did not experience the extreme effects of the ‘boom’ and are not as likely to have severe price degradation. Mid priced properties should be relatively stable- no big discounts for buyers, but some assurance of steady value for the future.

Let’s ponder the slowing exodus as we have a look at recently sold homes in Spring Valley:

2035 Terracina Circle, Spring Valley, CA 91977 was built in 1973 and was sold 9 times since. It has 3 beds, 1.5 baths and 1,125 sq. ft. It peaked at $355k in 2006 and sold for $215k ($191/sq.ft.) a few days ago. Lots of traffic in and out of that 35 year old condo. Where have they all gone?

2065 Hawkins Way, Spring Valley, 91977: 784 sq. ft., 2 beds, 1 bath. Some disagreement here as to be expected with technology. According to Trulia, this house is either sold or unsold and has 784 square feet or 1,950 (the second number happens to be the year built). Redfin thinks it sold in January, the listing agent is still trying to sell it. My guess is that it is a very recent sale, date unknown, and the price was $170k although they were asking only $165k.

(Get used to it- these companies are scrambling to get more and more data out to us faster and faster. Misteaks are inevitable)

3213 Helix Street, Spring Valley, 91977 is another mystery. My own Redfin site shows it as an active listing with 1,488 sq. ft., 2 beds, 2 baths, asking $360k. Farther down the page it shows ’sales history’ where it sold for $188k on March 4, 2008 (which agrees with Trulia). The Redfin listing was modified on March 19, so maybe it is relisted. The technology gods are not always kind and all that data has to be typed by humans.

If you’ve been looking at listings long enough, you get used to some confusion. You can just pick up the phone and probably clarify things in a few minutes with the listing agent. If it’s a house you might want to buy, call your Redfin agent. That last house could save you $7,198 with Redfin.

A final thought: If people aren’t leaving San Diego, and more are moving in from outside the US, and more are being born … where will they live? Do we have enough homes for them all? How do you think this will effect future prices?

---